Aye Finance Secures INR 137 Crore Debt Funding to Empower MSMEs in India

Aye Finance Secures Debt Funding
Preeti Bali / 1:20 pm / April 5, 2024

Aye Finance, a leading fintech lender in India, has secured INR 137 crore in debt funding from Invest in Visions, a German impact investment and portfolio management firm. This collaboration strengthens Aye Finance’s ability to provide crucial financial support to underserved micro, small, and medium enterprises (MSMEs) across the country.

The funding, provided through IIV Mikrofinanzfonds and another private fund managed by Invest in Visions, with support from Agents For Impact (AFI), follows Aye Finance’s successful Series F funding round of INR 310 crore led by the UK’s British International Investment (BII) in December 2023.

Fresh Capital Empowers Growth and Development

This influx of capital will significantly enhance Aye Finance’s capacity to offer essential financial assistance to MSMEs. The funds will be used for on-lending to these businesses, enabling them to expand their operations and contribute to India’s economic development.

“This new funding allows us to reach a wider base of micro enterprises and offer innovative financial solutions tailored to their diverse needs,” said Krishan Gopal, CFO of Aye Finance.”We are certain that this will engage more business visionaries to open their maximum capacity, at last encouraging position creation and financial success all through the country.”

Collaboration for Financial Inclusion

The partnership between Aye Finance, Invest in Visions, and Agents for Impact signifies a shared commitment to empowering MSMEs and driving financial inclusion in India.

“We are delighted to collaborate with Aye Finance in their mission to provide responsible funding to MSMEs in India,” said Camellia Genova, senior portfolio manager at Invest in Visions.”These organizations are generally underserved by banks and frequently rise out of the microfinance area.”

Aye Finance: A Leading Force in MSME Lending

Founded in 2014 by Sanjay Sharma and Vikram Jetley, Aye Finance has carved a niche in offering affordable business loans to microenterprises in India. They utilize a unique cluster-based credit assessment system powered by AI algorithms to evaluate risk efficiently, even in the absence of traditional business documentation.

The company’s dedication to supporting small businesses is evident in their recent milestone – surpassing INR 10,000 crore in loans disbursed to these enterprises. Aye Finance boasts an active client base exceeding 4.5 lakh micro enterprises and manages an impressive asset under management (AUM) of over INR 4,000 crore.

Financial Success and Future Prospects

Aye Finance reported a remarkable growth trajectory, with their Q1 FY24 profit after tax surging to INR 38.67 crore, a significant 4x increase compared to INR 9.78 crore in Q1 FY23.

The company actively supports microenterprises in various sectors, including manufacturing, services, trading, job work, and dairy. They compete effectively in the lending technology space against players like ftcash, ARTH, FlexiLoans, Lendingkart, LenDenClub, and Kinara Capital.

This strategic debt funding from Invest in Visions positions Aye Finance for continued growth and reinforces their commitment to empowering MSMEs and fostering financial inclusion across India.

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